Companies serving the offshore energy sector must accept that crude oil prices are not going to bounce back anytime soon and look to diversify into other market areas in the same way the commercial shipping industry does when high crude oil prices squeeze its profit margins.
Patrik Wheater, the Managing Director (photo) of specialist maritime PR consultancy Seaborne Communications, said: “The commercial shipping industry has developed an uncanny ability to adjust to the historical boom and bust cycle of international seaborne trade and diversify into other maritime sectors that are more commercially favorable. But it seems those companies serving the offshore sector are just waiting for an upswing. This isn't going to happen anytime soon. The offshore marine sector must look at opportunities elsewhere.”
With Brent crude oil prices tumbling to less than US$30/bb and analysts predicting persistent low oil prices for the medium term, Wheater, a former shipping journalist, believes opportunities do exist for the offshore marine sector in other areas.
He said that while some equipment suppliers will inevitably struggle, particularly those pushing oil and gas processing and subsea equipment, other suppliers that have traditionally served the offshore sector could find opportunities in the commercial shipping market and the nascent offshore mining industry.
“With sanctions now lifted on Iran, increasing the flow of oil from the Middle East, there could be a requirement for additional FSO (floating storage and offloading) capacity, while offshore support vessels could find employment in the emergent offshore mining industry, particularly offshore Australia. This is a new area for both industries,” said Wheater in a blog on his website.
Offshore mining is nothing new but most activities are confined to shallow waters close the shore. However, more deep-sea mines are beginning to emerge as the industry looks to exploit higher yield concentrations for significantly less investment and infrastructure required of a land-based mine.
According to mining industry analysts there are massive sulphide deposits, manganese nodules and cobalt-rich crusts on the seabed that can be extracted relatively easily. “The mining industry knows little about sub sea exploration and shipping knows little of the requirements of the mining industry, so there is a need for a concerted marketing drive if these industries can combine their technical know-how to benefit commercially from the extraction of minerals and metals from the seabed.
“Certainly both sides have to placate environmentalists that the technology is available to ensure that the extraction process is contained and will not impact negatively on the marine ecosystem. But this is a potentially lucrative new market for the offshore shipping industry,” said Wheater.
Next year, Marine Assets Corporation will take delivery of what will be the world’s first deep sea mining ship. The 227m long, 40m wider vessel will operate the Solwara 1 project offshore Papua New Guinea, extracting high grade seabed metals and ore in water depths of 1,600 meters.
